CHICAGO -- The last stand-alone nonprofit hospital in the Detroit metropolitan area is expected to merge with Catholic health care giant Ascension Health, the providers announced Tuesday.
Crittenton Hospital, a 290-bed hospital based in the affluent Detroit suburb of Rochester, announced it had signed a letter of intent on Dec. 31 with St. Louis-based Ascension, the largest not-for-profit health care system in the country. The letter launched a six-month due diligence period to negotiate the details of the sale.
It's the latest in a series of mergers in the non-profit health care sector, with Michigan being a particularly active state for the trend.
Crittenton, which is rated Baa3 by Moody's Investors Service, has been considering a sale for at least a year, according to local reports. Several other systems were reportedly interested despite the hospital's deteriorating financial position.
Crittenton has $105.5 million of outstanding bonds issued by the Michigan State Hospital Authority. Moody's affirmed its Baa3 rating on the hospital in July, noting a favorable liquidity position as well as four straight years of operating losses. One of the challenges Moody's analysts cited was being a small stand-alone hospital in a metro Detroit area dominated by larger systems.
"The financial and operating strength of the health system will dramatically improve the financial and operating foundation of Crittenton and continue its upward trend of financial stability," Crittenton CEO Roy Powell said in a statement.
